Stability is great, but low-volatility stocks may struggle to deliver market-beating returns over time as they sometimes underperform during bull markets.
Finding the right balance between safety and returns isn’t easy, which is why StockStory is here to help. Keeping that in mind, here are three low-volatility stocks to steer clear of and a few better alternatives.
Akamai Technologies (AKAM)
Rolling One-Year Beta: 0.78
With a massive distributed network spanning 4,100+ points of presence in nearly 130 countries, Akamai Technologies (NASDAQ: AKAM) provides a global distributed cloud platform that helps businesses deliver, secure, and optimize their digital experiences online.
Why Should You Sell AKAM?
- 5.1% annual revenue growth over the last two years was slower than its software peers
- Bad unit economics and steep infrastructure costs are reflected in its gross margin of 59.1%, one of the worst among software companies
- Long payback periods on sales and marketing expenses limit customer growth and signal the company operates in a highly competitive environment
Akamai Technologies is trading at $88.06 per share, or 3x forward price-to-sales. To fully understand why you should be careful with AKAM, check out our full research report (it’s free for active Edge members).
Tenable (TENB)
Rolling One-Year Beta: 0.85
Starting with the widely-used Nessus vulnerability scanner first released in 1998, Tenable (NASDAQ: TENB) provides exposure management solutions that help organizations identify, assess, and prioritize cybersecurity vulnerabilities across their IT infrastructure and cloud environments.
Why Do We Think Twice About TENB?
- Average billings growth of 10.4% over the last year was subpar, suggesting it struggled to push its software and might have to lower prices to stimulate demand
- Estimated sales growth of 7.1% for the next 12 months implies demand will slow from its two-year trend
- Operating profits and efficiency rose over the last year as it benefited from some fixed cost leverage
At $23.85 per share, Tenable trades at 2.7x forward price-to-sales. Check out our free in-depth research report to learn more about why TENB doesn’t pass our bar.
Amphastar Pharmaceuticals (AMPH)
Rolling One-Year Beta: 0.77
Founded in 1996 and known for its expertise in complex drug formulations, Amphastar Pharmaceuticals (NASDAQ: AMPH) develops and manufactures technically challenging injectable and inhalation medications, including both generic and proprietary pharmaceutical products.
Why Are We Hesitant About AMPH?
- Modest revenue base of $723.3 million gives it less fixed cost leverage and fewer distribution channels than larger companies
- Efficiency has decreased over the last two years as its adjusted operating margin fell by 4.3 percentage points
Amphastar Pharmaceuticals’s stock price of $27.01 implies a valuation ratio of 7.8x forward P/E. Dive into our free research report to see why there are better opportunities than AMPH.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
